Ruling Has Some Mulling the Necessity of Mandating Insurance

Published on

WASHINGTON — Though they have battled for more than a year, President Obama and the health insurance industry agree that the requirement for most Americans to obtain insurance, struck down by a federal judge, is absolutely essential to the success of the new health care law.

Without it, they say, the whole package collapses, dashing hopes for universal coverage and cost control. Ripping the mandate from the law would have ''devastating consequences,'' the White House said Tuesday.

But not everyone agrees. In the wake of the decision Monday, which held that the individual mandate was unconstitutional, some lawmakers and some consumer advocates are investigating possible alternatives.

''I am not a big fan of the individual mandate,'' said Senator Ben Nelson, Democrat of Nebraska, who voted reluctantly for the health legislation.

Mr. Nelson said he had asked the Government Accountability Office, an investigative arm of Congress, to identify possible alternatives and to analyze how effective they would be in extending coverage to the uninsured.

Jamie Court, the president of Consumer Watchdog, a liberal advocacy group, said, ''The health insurance purchase mandate is not necessary for health care reform to work.'' Indeed, Mr. Court said, it was ''a sop to health insurance companies,'' which guarantees they will have millions of new customers, without a firm cap on how much they can charge.

One alternative to the individual mandate would create financial incentives for people to buy insurance. For example, health policy experts said, insurers could offer discounts to people who sign up early, and they could increase premiums for people who delay enrollment. Medicare imposes such late-enrollment penalties on some people who delay signing up for Part B, which covers doctors' services, and Part D, which covers prescription drugs.

Another approach would be for insurers to limit enrollment to one or two months a year, so that consumers could not sign up on the spur of the moment, when they need care.

Mr. Obama champions what he describes as progressive features of the law: subsidies to help low- and moderate-income people buy insurance; a requirement for insurers to offer coverage to anyone who applies; a ban on insurers' charging higher premiums to people who are or have been sick.

Without an individual coverage requirement, Mr. Obama and insurers say, consumers could go without insurance until they needed care. Fewer healthy people would buy insurance, according to this logic, and those buying it would be sicker than average, so premiums would be higher — for employers, for employees and for consumers who buy insurance on their own.

Congress set forth that argument in detailed findings included in the new law. The Justice Department has repeatedly cited those findings in defending the law in court. The law ''could not function effectively without the minimum coverage provision,'' the department said in the case decided Monday by Judge Henry E. Hudson of the Federal District Court in Richmond, Va.

The Justice Department said Tuesday that it would appeal that ruling to the United States Court of Appeals for the Fourth Circuit, in Richmond.

''The department believes this case should follow the ordinary course of allowing the courts of appeals to hear it first so the issues and arguments can be fully developed before the Supreme Court decides whether to consider it,'' said Tracy Schmaler, a Justice Department spokeswoman. Ms. Schmaler pointed out that the provision struck down by Judge Hudson does not take effect until 2014, so appellate courts will have ''more than sufficient time'' to consider the case.

Brian J. Gottstein, a spokesman for Virginia's attorney general, Kenneth T. Cuccinelli II, who filed the lawsuit, said no decision had been made about whether to petition the Supreme Court to hear the case.

In the past, some prominent Republicans have supported an individual mandate, as a way to foster individual responsibility and as an alternative to requirements for employers to provide coverage. In 1993, the main Senate Republican alternative to President Bill Clinton's health plan included an individual mandate, with stiffer financial penalties than those in the law adopted this year.

An individual mandate was also at the heart of the health plan adopted in 2006 by Massachusetts, with support from Mitt Romney, who was then governor. ''What we did is the ultimate conservative plan,'' Mr. Romney said earlier this year.

In a letter to Congressional leaders last year, another Republican governor, Arnold Schwarzenegger of California, said, ''An enforceable and effective individual mandate, combined with guaranteed issuance of insurance, is the best way to accomplish'' coverage for all.

But the Republican view on Capitol Hill, fortified by the Tea Party movement, is much different. Many Republicans now denounce the individual mandate as a federal infringement on individual freedom. It will, they say, require many to buy insurance more comprehensive and more costly than what they now have.

At the same time, in their campaign manifesto this year, House Republicans said, ''Health care should be accessible for all, regardless of pre-existing conditions or past illnesses.'' How they would achieve that goal, without an individual mandate, is not entirely clear.

In the manifesto, ''A Pledge to America,'' House Republicans said they would expand high-risk pools, for people who cannot obtain coverage because of pre-existing conditions. They would also encourage reinsurance programs, under which states pay a large share of claims exceeding some threshold.

When similar proposals were offered by House Republicans last year, the Congressional Budget Office said they could reduce premiums, but would cover only three million people who were uninsured — about one-tenth of the number expected to gain coverage under President Obama's health care overhaul.

Democrats say those proposals are not nearly enough. Theda R. Skocpol, a professor of government and sociology at Harvard and a student of health care politics, said, ''If courts invalidate the individual mandate, Democrats in Congress and the president should have some alternatives ready to go.''

 Kevin Sack contributed reporting from Atlanta.

Latest Videos

Latest Releases

In The News

Latest Report

Support Consumer Watchdog

Subscribe to our newsletter

To be updated with all the latest news, press releases and special reports.

More Releases